TIPS AND HINTS FOR WORKFORCE PLANNING
WORKFORCE DATA AND METHODS FOR ANALYSIS
Data is required to assess the current and future requirements for employees.
This has to be in the context of the external environment and in the context of
future plans for changes in the way the organisation goes about delivering its
services and its long term goals.
Ability to predict depends on timescale the forecast is intended to cover – 1 to 2
years is relatively easy, 5 years is far more difficult- because technological or
economic developments may not yet even have been contemplated.
It also depends on the stability of the organisation – local authorities traditionally
have been easy to predict, unlike technology companies, for example. These
two influences affect the techniques used to forecast the demand for people.
There is a need to view the resulting forecasts as adaptable, and to pay attention
to the impact of the turbulent environment and the best way to achieve the
business objectives. Workforce forecasting is not intended to produce a
blueprint. It’s purpose is more to reduce the area of uncertainty and minimise the
unknown factor so that organisations can achieve competitive advantage by
being swifter to resolve the people issues, ensuring a flexible employment base.
In times of uncertainty and rapid change, this becomes even more important.
There are several different approaches to forecasting:
Systematic
Analyse past and present experience – analyse past business patterns and
numbers employed to make judgements about how many people will be required
to meet business targets in the future.
This is a straightforward approach, but only relevant in stable business
environments. It has been frequently used for predicting number of school
teachers, doctors, etc in relation to population trends based on staff;student
ratios, etc.
It can also be helpful in businesses with seasonal fluctuations.
Also under this approach is the use of Work Study – most commonly in
manufacturing industries where there are discrete production line tasks. Able to
compute number of staff required based on most productive.
A further approach is to combine this methodology with managerial judgement.
Managerial judgement
This process projects the number of employees required based on subjective
views of managers about likely future needs for people. This approach is quick
and requires little or no data collection, intangible factors can be taken into
account, and can use opinions from people outside the organisation.
Delphi technique falls within this category – required managers and experts to
submit their own forecasts in writing, circulated around the group, each revises
own forecasts taking into Competitive advantage will come from being swifter,
more creative and innovative and more flexible than other competitors. Planning
is simply bureaucratic account their colleagues views, and adjustments made
enabling a consensus forecast to emerge.
Working back from costs
Another approach to demand forecasting that removes past experience from the
equation is to plan on the basis of the future budget for staff costs, and then work
out how many people at each grade will be affordable. This ignores current
methods, ratios and productivity.
This approach has been frequently used in the public sector in recent years – so
numbers of staff are based on what the tax payer is prepared to pay rather than
what a community may need.
ANALYSIS OF WORKFORCE DATA
A.
Forecasting Internal Supply - Staff Turnover
Overall figures about staff turnover rates are of little help – what is important is
the likely turnover rate among specific groups of staff, such as those of a
particular age, those with a defined length of service, or in a particular
occupational category, by number of hours worked. Turnover is also influenced
by wider economic environment.
There are some general observations about staff turnover, which generally hold
true:
 It decreases with increasing age
 It decreases with increasing length of service
 It decreases with increasing skill and responsibility
 It is higher for women than men
 It decreases when the general level of unemployment rises.
What are the methods to analyse turnover?
1.
Wastage analysis
Number of leavers in a specified period
Average number employed in the same period
2.
x 100
Stability Analysis
Number of employees with n years’ service at a given date x 100
Number employed n years ago
If an organisation employed 1000 people at the start of 2009, and calculates that
at the end of year 800 will still be in their jobs, there would be a stability rate of
80%. This focuses on the proportion of people who remain rather than who
leave.
3.
Cohort Analysis
This looks at specific occupational groups or all those employed in each year –
so for example, focussing on those with less than one year’s service, turnover of
apprentices in each year of entry, turnover amongst full time staff compared to
part-time staff, turnover of relief staff.
This enables using past trends to forecast the extent to which future demand for
staff can be met internally.
It is common to calculate “half-lives” for each group – ie, length of time it takes for
each cohort to halve in size – this enables comparison between groups of jobs.
4.
Internal promotion analysis
This looks at movement up the ranks or grades in addition to general wastage
rates. It is meaningless to look at turnover rates for a particular role if no account
is taken of the fact that most of the posts for that role are filled by internal
promotion.
This would involve taking each grade and using past patterns of promotion to
work how often vacancies at each level are filled through internal promotion.
This is helpful if there are particularly specialist roles as it enables you to forecast
how many can be filled internally and how many would be required from external
market place.
5. Internal relief workers
Health and social care organisations often have a “pool” of people on internal
flexible contracts who can be called upon to undertake work. It can be useful to
identify the timescale before these staff are moved onto permanent, guaranteed
hours contracts to identify the quality of this method of recruitment. Similarly, the
length of time they stay as relief before leaving to work for another employer. If it
is a short period, it would suggest that this approach to resourcing is expensive.
B. FORECASTING EXTERNAL SUPPLY
How to fill the gap using the external labour market: some internal info available
such as
 response rates to adverts
 proportion of turnover explained by employees leaving to work for
competitors
 performance of new starters etc
Most labour markets are local – focus on travel to work area – look at general
population density, population movements, age distribution, unemployment rates,
school leavers, proportion with higher education, skill levels
This data is held in monthly journal of Labour Market Trends, also in Labour
Market Quarterly, and annual Social Trends Survey, plus reports following each
national census.
Also need to apply judgement and experience – eg, info on local transport
network which may expand or contract the travel to work area, construction of
new housing etc. Other issues, such as level of positive reporting of the
organisation or profession in the media.
Information on spend on agency staff is helpful. If this is high, it suggests that
the external supply of labour is very important. Comparison of spend for a
discreet part of the organisation over time can be helpful in showing a trend. If
level of spend is increasing, it would indicate scrutiny to assess reasons would
be helpful.
Higher paid, skilled jobs – regional or national labour market – far more difficult to
spot trends as so many variables.
C. OTHER DATA/INFORMATION
Workforce planning is more about just having the right people, with the right skills
at the right times. Just as importantly it is about having people with the right
attitudes…. The quantifiable data set out above will not provide that information.
For example, in the changing world of social care, person centred planning
requires attitudinal change, as does a focus on reablement.
Information on preparedness for an attitude shift by staff can be assessed
through staff surveys, questionnaires and focus groups. Tools such as Culture
Web mapping can also be helpful.
There is not much general information on UK societal attitudinal change.
However, general trends emerging from US are
 general reduction in loyalty
 younger workers – less trust in and respect for authority
 younger workers – look for what is fun and enjoyable
 younger workers have different views on fairness – tolerant towards
minorities and allowing people to be different, compared to older workers
who see it as “treating people equally”.
 People increasingly seeing work as a means to gain work experience and
boost their own employability.
WORKFORCE FLEXIBILITY
STRUCTURAL FLEXIBILITY
This refers to the types of contract and architecture of the organisation.
Structural inflexibility – narrowly defined jobs, hierarchical structure
Structural flexibility – deploys people when and where needed using a variety of
contractual arrangements – enables quick response to changed circumstances
and evolving customer expectations.
CULTURAL FLEXIBILITY
Structural flexibility requires employees to have a flexible mindset – willingness to
respond to change is as important as the ability to do so – requires gaining
commitment by having a working environment characterised by high levels of
trust, partnership and mutual respect.
It is important that flexibility is introduced carefully – and serious mistakes can be
made.
FUNCTIONAL FLEXIBILITY
This concept was introduced by John Atkinson – “The Flexible Firm” 1984 – core
workers, peripheral workers, and subcontracted workers.
The Core workers are functionally flexibile – they do not work to rigid job
descriptions but carry out a broad range of duties, across different levels in the
organisation. This requires promotion of multi skilling – increase the range of
tasks that people are willing and able to perform. The number of different JD’s in
the organisation will reduce, there will be more teamworking, hierarchies are
flatter – more people are employed on the same grades carrying out the full
range of activities.
There can be some disbenefits of functional flexibility – training costs will be
higher, there can be high levels of staff resistance – particularly if they prefer to
specialise in one type of work. Forcing multi skilling may result in dissatisfaction
and the loss of good performers to competitors. Some skills are to complex or
specialist to be shared by several people – and forcing the pace of change can
lead to skill dilution, with a group of people unable to carry out the job as
effectively as one highly-trained individual.
There are limits to functional flexibility, and it must be introduced within
reasonably defined parameters.
The peripheral workers can be functionally flexible, but are also
“numerically flexible”. Some of these are lower skilled on temporary contracts,
the others are bought in to cover workload peaks or staff absence.
Part-time working is the most common form of atypical working. 51% of the
health workforce, for example, work part time. This then enables those people to
be called in to work additional hours, giving an easily accessible pool of
additional labour to cover for sickness, training, holidays.
Part-timers often earn less than the lower NI threshold, meaning that employers
do not have to pay contributions.
TEMPORAL FLEXIBILITY
This refers to WHEN people work – eg, annual hours, flexi time, etc. Zero hours
contracts can be useful in case of casual employees who work on a regular basis
– particularly when there are frequent and substantial surges in demand for
employees on particular days or weeks of the year, but where this is also
unpredictable.
A variation on zero hours can be a system that guarantees a casual worker a
minimum number of hours week or days a year – the core hours a fixed on a
week by week basis, and then additional hours required are flexible and can be
arranged at very short notice.
VMcCririck/December 2009